TaxTMI 
TaxTMI 
TaxTMI 
2017 (10) TMI 1522
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.... contested before competent authorities" (para 4.3 page 6 of order) as well as in failing to consider the fact that the appellant had clearly disputed the valuation endorsed by the stamp valuation authority vide point no. 3 of the letter dated 18.03.2016 submitted in the course of assessment proceedings as well as in the course of hearing of first appeal also, and has thus failed in giving proper directions to the AO in terms of provisions of section 50C sub-section (2) for referring the valuation of sold plot of land to a Valuation Officer referred to in that section. 3. The learned Appellate Authority has erred in law and in fact by holding that " A.O. had no other option but to accept the valuation as taken by Sub-Registrar for stamp duty purpose which in my view is correct as per facts of case and according to the provision of section 50C of the Act" (para 4.3 last para page 6 of the Appellate Order. 4. The learned Appellate Authority has erred in law and in fact in failing to consider various issues raised vide submission dated 23.09.2016 during the course of hearing of appeal, specially the matters relating to application of commercial rates issued by 'District Level Comm....
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.... been made before any other authority, court or the High Court. Neither any specific manner nor any particular Form in Income Tax Rules is prescribed for requesting the AO to refer the matter to Valuation Officer. The basic condition is "claiming" before the AO that value adopted by Stamp Valuation Authorities exceeds the Fair Market Value at which the transaction of sale has taken place. Subsequent condition is that no appeal is filed under Stamp Duty Law. 3.2. In the present case, both the conditions are fulfilled. Claim was made vide letter dated 18.03.2016 [PB 28-29]. Further, no appeal was filed under Stamp Duty Law. 3.3. The lower authorities have erred in holding that the assessee has not made a request for referring the matter to the Valuation Officer. It is submitted that vide letter dated 18.03.2016 [PB 28-29], the assessee has disputed the value of the plot taken by the Stamp Duty Authorities. It is a settled legal proposition that ld. AO while discharging his duties is bound to refer the valuation to the valuation officer when the assessee has disputed the value adopted by the Stamp Authorities, even if the assessee has not made a specific request for the same. ....
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....e Calcutta High Court in the case of Kumar Agarwal (supra) cited by the assessee are squarely applicable. Therefore, the ld Assessing Officer is directed to refer the matter to the DVO and take fair market value on the date of sale/transfer. On that basis, he will compute the capital gain as per law. Therefore, we set aside this issue to-the Assessing Officer." [CLC 40-41] Other ITAT 3.4.iv. Sarwan Kumar v. ITO [2014] 45 taxmann.com 16 (Delhi - Trib.) "Head Notes - Section 50C of the Income-tax Act, 1961 - Capital gains - Special provision for full value of consideration in certain cases (Conditions precedent) - Assessment year 2006-07 - Whether where an assessee has claimed before Assessing Officer that value of land and building assessed by stamp valuation authority exceeded fair market value of property, then in terms of section 50C(2)(a), Assessing Officer ought to have referred matter to valuation officer instead of straightway deeming value adopted by stamp valuation authority as full value of consideration - Held, yes [Para 6] ...." 3.4.v. Anil Kumar Jain vs. ITO [2013] 34 taxmann.com 258 (Delhi - Trib.) "..Head Notes - Section 50C of the Income-tax Act, 1961 - Cap....
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.... not been referred to in the other tax saving sections like section 54, 54EC and 54F. Therefore, these tax saving provisions will operate without any reference to section 50C. 3.2. Reliance is placed on the judgment of the Hon'ble Bombay High Court in the case of Ace Builders (P) Ltd. (2006) 281 ITR 210 (Bom.) (CLC 17-24) wherein it was held that "...It is true that section 50 is enacted with the object of denying multiple benefits to the owners of depreciable assets. However, that restriction is limited to the computation of capital gains and not to the exemption provisions. In other words, where the long-term capital asset has availed of depreciation, then the capital gain has to be computed in the manner prescribed under section 50 and the capital gains tax will be charged as if such capital gain has arisen out of a short-term capital asset but if such capital gain is invested in the manner prescribed in section 54E, then the capital gain shall not be charged under section 45 of the Incometax Act..." [CLC 23] 3.3. In the above background it is submitted that when, as per the computation of total income, the capital gains offered for tax are Rs. NIL, provisions of section 50C....
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....provision, a fiction cannot be imported in other section. This view has been squarely adopted by Hon'ble Delhi High Court in the case of CIT vs. Smt. Nilofer Singh (supra) and followed it by this Bench ITAT in the case of Gyan Chand Batra vs. ITO (supra). Respectfully following the same, we hold that while computing exemption u/s 54, the actual sale consideration is to be taken into consideration and not the stamp duty valuation u/s 50C...." 3.6. In view of the above ratio, the provisions of section 50C cannot be invoked in the present case. From perusal of Return Form [PB 34-35] and computation of return of income [PB 42], it is evident that the assessee's capital gain was Rs. NIL. Hence, ld. CIT(A) has erred in confirming the action of ld. AO of invoking the provisions of section 50C. In view of the above, provisions of section 50C has been wrongly invoked and, therefore, the addition deserves to be deleted. GROUND NO. 4: COMPUTING CAPITAL GAINS AT Rs. 48,84,149 BY CONSIDERING THE PLOT SOLD AS COMMERCIAL ASSET: 1. ASSESSING OFFICER Ld. AO considered the plot of land to be commercial in nature on the basis of endorsement of Stamp Valuation Authority [PB 8] and adopt....
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....lot and Sub Registrar has wrongly valued the same at Rs. 1,19,71,700/- without informing appellant. Therefore, he requested for considering the declared sale consideration of Rs. 80,40,000/- for computing Capital Gain. On careful consideration of facts, it is s3een that even before me except furnishing photographs of land, no evidence is filed claiming that the order of Sub Registrar charging additional stamp duty on value of Rs. 1,19,71,700/- was appealed against, by the assessee. Moreover the assessee contended that AO should have referred the matter for valuation, but from the records it is seen no such request was made during assessment proceedings. As per section 50C(2) if the assessee had challenged the stamp value made by registration of authorities or disputed the said valuation before the competent authorities court or High Court, then AO may refer valuation of capital asset to a valuation officer. As observed in this case, no such objection was raised before AO nor contested before competent authorities. Further as per section 155(15), the assessing officer can rectify the assessee if the valuation done by Sub-registrar is modified in any appeal or revision by the com....
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....a result of such transfer: [Provided that where the date of the agreement fixing the amount of consideration and the date of registration for the transfer of the capital asset are not the same, the value adopted or assessed or assessable by the stamp valuation authority on the date of agreement may be taken for the purposes of computing full value of consideration for such transfer: Provided further that the first proviso shall apply only in a case where the amount fo consideration, or a part thereof, has been received by way of an account payee cheque or account payee bank draft or by use of electronic clearing system through a bank account, on or before the date of the agreement for transfer.] (2) Without prejudice to the provisions of sub-section (1), where - (a) The assessee claims before any Assessing Officer that the value adopted or assessed (or assessable) by the stamp valuation authority under sub-section (1) exceeds the fair market value of the property as on the date of transfer; (b) The value so adopted or assed (or assessable) by the stamp valuation authority under sub-section (1) has not been disputed in any appeal or revision or no reference has been made b....